Thanks to an Affordable Care Act rule, regulatory costs increased by more than $1.8 billion this week. Annual costs increased by $458 million, compared to $389 million in monetized benefits; paperwork accelerated by more than 2.4 million hours. There were sixteen regulations this week that monetized costs or benefits. The per capita regulatory burden for 2015 is $570.
In previous work, AAF focused on the online and traditional gig economy by exploring the changes in this labor force since the economic downturn. But within this broad class, a narrower category of networked technologies has taken the spotlight to become a constant focus for policymakers, critics, and presidential hopefuls. These technologies meld peer-to-peer networks on both the production and consumption sides to sell goods and services. While labor practices have been a constant topic of conversation, many have lost sight of the primary benefit of new network-based service technologies, and the chance that it affords policymakers.
The shortened holiday week produced a modest number of new regulations. Annual costs were just $151 million, with no comparable benefit figures; paperwork accelerated by more than 500,000 hours. An EPA proposal on refrigerant management, designed to reduce the release of ozone-depleting substances, led the week. The per capita regulatory burden for 2015 is $561.
Two new Federal Reserve rulemakings in the last month have pushed Dodd-Frank’s aggregate financial costs past $35 billion, with $29.3 billion in final rules. With more than five years of implementation, it’s clear that regulators still have dozens of new measures left to propose and finalize. The most expensive portions of the law could ultimately lie ahead for consumers.
After $2.8 billion in regulatory costs last week, regulators bested that performance with $2.9 billion this week. In total, annualized costs this week were $1.3 billion, compared to $497 million in benefits, and a somewhat ridiculous 16 million hours of paperwork. To put the paperwork in perspective, it would take more than 8,000 full-time employees to complete the requirements from the last five days of new regulation. The per capita regulatory burden for 2015 is $560.
The Environmental Protection Agency (EPA) recently released a new round of air quality standards for ground-level ozone. The measure lowers the threshold for “nonattainment” status from 75 parts per billion (ppb) to 70 ppb and imposes $1.4 billion in nationwide annual costs. Generally, “nonattainment” counties exceed EPA’s threshold for ozone (“smog”) pollution. Counties deemed nonattainment must work with their states to devise a State Implementation Plan (SIP) to meet EPA goals. According to EPA, this must, “show how the nonattainment area will attain the primary [ozone] standard ‘as expeditiously as practicable,’ but no later than within the relevant time frame.”
Courtesy of EPA’s final ozone rule, regulatory costs increased by more than $2.8 billion. Annual burdens were $1.7 billion, compared to $4.5 billion in benefits; paperwork accelerated by 8.8 million burden hours. The per capita regulatory burden for 2015 is $551.
The American Action Forum (AAF) has spent considerable time outlining the efficacy, potential benefits, and international perspectives behind a budget for federal regulation. Now, Senator Dan Sullivan (R-AK) has sponsored the “RED Tape Act of 2015” (S. 1944), which aims to install a British-style “one-in, one-out” method for regulatory accounting.
Research from the American Action Forum (@AAF) finds that the U.S. will have to spend an additional $38 to $45 billion annually in order to reach the goals set by the United Nations in Paris. This would be added onto the president’s already expensive Clean Power Plan. Combined, these regulations could reach $73 billion per year in costs. The benefits of this would be a global temperature decrease of less than 0.2 degrees.
Click here to read the full research.
As the world meets in Paris at the United Nations (UN) Conference on Climate Change during the first two weeks in December, it is important to take note how the U.S. has already regulated greenhouse gases (GHGs). According to American Action Forum (AAF) research, regulators have already imposed $26 billion in annual costs to limit GHGs and have proposed an additional $1.7 billion. However, to meet President Obama’s climate goals the nation will have to spend up to $45 billion more each year by 2025.
On October 6, 2015, the Centers for Medicare and Medicaid (CMS) published its final rule on Stage 3 of the Meaningful Use Requirements for the Electronic Health Record Incentive Program. This program adjusts payments to Medicare and Medicaid providers for implementing and “meaningfully using” (or not) interoperable electronic health records (EHR) systems. These standards are being implemented in three stages to gradually move providers toward the desired end point: to “provide efficiencies in administrative processes which support clinical effectiveness, leveraging automated patient safety checks, supporting clinical decision making, enabling wider access to health information for patients, and allowing for dynamic communication between providers.”
Based on initial calculations from the American Action Forum (AAF), we predicted approximately $4.5 billion in new annual costs and $20 billion in benefits. This compares to OIRA’s range of $3 to $4.4 billion in costs and $9.8 to $22.8 billion in benefits, within AAF’s ranges. However, if the OIRA report included more than just its thirteen listed regulations, the actual cost figure would be $14.4 billion, or roughly three times the “official” amount.
The “Clean Power Plan” and a Dodd-Frank rule on margin requirements for swaps led another pricey week in regulation. Total regulatory costs eclipsed $17.4 billion, with $8.6 billion in annual burdens and $42 billion in monetized benefits. Even though EPA published a deregulatory measure, the agency still managed to impose net costs of $12.2 billion. The per capita regulatory burden for 2015 is $543.
“Mega-rules,” regulations that impose more than a billion dollars in economic costs, are growing more frequent, with obvious economic consequences. From 2006 to 2008, the nation averaged two of these rules annually. From 2009 to present, this figure has increased to roughly three per year. During the Obama Administration, these mega-rules have imposed total annual costs of $65.1 billion, with a related 19.5 million paperwork burden hours.